What is the Relationship between Blockchain and Bitcoin?


Relationship between Bitcoin and Blockchain

Now people have learned that blockchain is the underlying technology of Bitcoin, and Bitcoin is the killer application of blockchain. Many people have also broadened their thinking and tried to use blockchain technology not only for virtual currencies but apply to all walks of life.

In fact, blockchain technology is not instantly rooted in the hearts of the people. Its development has gone through the 1.0, 2.0, and 3.0 eras. Each era has different characteristics and meanings. Today, Xiaojun Jun will summarize it for everyone. In the era of blockchain 1.0 led by coins, what kind of characteristics does it have?

Blockchain 1.0: The Era of Digital Currency

In 2008, the U.S. subprime mortgage crisis triggered a global financial crisis, and the fiat currencies of various countries depreciated sharply. At this time, a person (or organization) calling himself Satoshi Nakamoto published an article entitled "Bitcoin: A Peer-to-Peer Electronic Cash System "paper, this paper describes a brand new digital currency system-Bitcoin.

Blockchain and Cryptocurrency relationship

Bitcoin solves the problem of a constant amount of currency issuance and circulation without a central institution at all. Transaction transfers through the Bitcoin system will be broadcast throughout the network, making it open and transparent, non-tamperable and highly credible. One can safely transfer bitcoins to unknown people on the other side of the earth through the bitcoin network. The advent of the Bitcoin white paper marks the birth of Bitcoin's underlying technology, the blockchain.

In addition, it also marks that the concept of digital currency, which was proposed before 1996, was truly implemented at this time. With the first batch of Satoshi Nakamoto being dug out, the blockchain was used as the bottom layer. The digital currency system of technology has officially opened the era of blockchain 1.0. It can be said that the era of blockchain 1.0 is the era of single application scenarios of digital currencies.

The blockchain 1.0 era seems to be a kind of tinder. Although it has not yet become a source of 燎 hara, it is the first to bring digital currency into the real world. From the beginning, when cryptographic enthusiasts decrypted games in their spare time to entering financial products whose exchange prices have skyrocketed, the consensus of digital currencies has expanded tremendously at this stage.

Bitcoin is the most typical representative of Blockchain 1.0. It represents the application of digital currency in reality, including its payment means, circulation media and other functions. The most famous event is nine years ago, a man named Laszlo

Hanyecz's programmer bought two pizza vouchers for 10,000 bitcoins. This is widely considered to be the first transaction with Bitcoin, and it is also one of the enduring stories of the currency circle. Many currency friends call this day "Bitcoin Pizza Day".

Later, as bitcoin gained more and more widespread recognition, around the basic digital currency of bitcoin, people started many business and peripheral services, such as wallet, exchange, mining, and mining machine business.

In addition, the use of blockchain technology as the foundation has also promoted the emergence of a series of other digital currencies. Some old altcoins were born. Digital currencies such as Litecoin and Dogecoin entered the market and performed their functions during that period. However, most of the digital currencies at that time were based on bitcoin's code and were slightly modified. The application fields were also the same as those of bitcoin, mainly in the field of currency and payment, but there was no widespread application.

3 Main Characteristics

Here, the characteristics of the blockchain 1.0 era mainly have three aspects:

(1) Technically realized decentralization

Friends who have read our previous article know that the decentralized system is not the first time that Bitcoin has been proposed. Prior to this, there were many members of "crypto punk" who, as believers in cryptography, tried to destroy the now centralized currency. System, they also proposed digital currency, and all ended in failure.

Until Satoshi Nakamoto integrated these technologies, using the concept of "time stamping" to solve the "double spend" problem of "transaction repetition" and giving those who maintain the system / competitive packaging rights to use Bitcoin as a "mining reward" Only at the technical level has it realized a decentralized system of "free trade on the entire network and common maintenance on the entire network".

(2) Source code is open source, altcoins appear

The consensus mechanism is a very important part of blockchain technology, and this consensus mechanism can be verified by open source source code.

The most significant feature of the blockchain 1.0 era is the use and payment of digital currencies. It is also with the open source source code that the Bitcoin network is reproducible, which gave birth to hundreds of various digital currencies represented by Bitcoin at the time, such as Litecoin and Dogecoin. and many more.

Through the use of these digital currencies, in this distributed, decentralized, globalized way, everyone can allocate and trade various resources with others.

(3) Limited to the financial industry, the vertical application scenario of currency payment

In the currency scene of the financial sector, the Blockchain 1.0 era set off a wave. The first and most successful application of blockchain technology is digital currency, which resonates with many related fields such as digital payment, remittance, and transfer in the traditional financial industry, and has attracted much attention.

In the fields of digital payments, transfers, remittances, etc., if traditional financial methods are used, then it is necessary to use third-party institutions such as banks to open, account, counterparty, clearing organizations, overseas banks and other complicated and complicated processing processes, not only time Long and costly.

And the use of blockchain technology can save the complicated processing process in the middle, and directly perform point-to-point payment. Although digital currency has not been accepted by the traditional financial industry at this stage, the blockchain technology behind it has long been recognized and may bring great benefits to the financial industry in terms of processing efficiency.

But it is worth mentioning that although we named this stage the era of blockchain 1.0 from the perspective of technological development, in fact, we may still know its digital currency applications the most in this era. At this stage, the public's attention is almost focused on the price of the currency. The concept of blockchain is often affixed to Bitcoin, and at this time has not been listed separately as an independent technology attracting attention.

Blockchain Meaning and restrictions

Blockchain 1.0 gave birth to the largest cryptocurrency, Bitcoin. Digital currency applications represented by bitcoin, whose scenarios include monetary functions such as payment and circulation, are the origin of blockchain technology and a force to revolutionize the future.

Although there are many problems, including violent price fluctuations, deflation caused by the upper limit of quantity, waste of energy by mining, and restrictions imposed by governments of various countries, etc., it is still the most successful application of blockchain technology and outlines An ideal vision-world currencies.

Bitcoin outlines a grand blueprint. Future currencies will no longer rely on the issuance of central banks in various countries, but a global currency unification. This point of inspiration is crucial, it creates a way for us to solve many financial problems in the future.
Bitcoins and public ledger blockchain

It has been accepted by some markets in Europe and the United States and other countries, and has also spawned a large number of emerging industries, such as digital currency trading platforms. The digital currency at this stage realized part of the functions of currency and was able to realize goods transactions.

And, in this period, people finally connected the virtual currencies dug in the computer with the real value, which is a landmark.

In addition, the blockchain 1.0 era also has great limitations. At this time, people are still most concerned about digital currencies based on blockchain technology. The main focus is on how much they are worth and how to dig. How to buy and how to sell. It is also based on the limitations of application scenarios that the technology itself has not received the due attention, and everyone did not expect that the blockchain technology can be taken out separately and applied to other industries or use scenarios.

In general, blockchain 1.0 is actually an era from 0 to 1.Although it has various limitations, it is undeniable that it is great. The biggest significance of Blockchain 1.0 is that under the accumulation of many technologies, a new technology model of Blockchain was innovated, and then digital currency was used as a medium to solve the problem of financial payment and show the world The power of blockchain.

The fire of the stars can be ignited. At this point, Bitcoin and the blockchain have begun a journey of ten years and have not ended so far.

See also:

  • Predictions Blockchain
  • Cryptocurrencies Facts Predictions
  • Top Influential People in Cryptocurrency
  • Bitcoin Panic Index
  • Global Cryptocurrency Fund Development
  • Why Bitcoin Price falling

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